I'm new here and yet to be deeply involved with the project, so I hope this isn't taken as idle backseat driverism, but I had some ideas about how to add complexity to speechcraft gameplay as suggested here. This can be a general brainstorming thread if so desired.

Big idea:

In the Witcher 1, there was a quest where you had to perform an autopsy. Depending on how you went about preparing, you could come to a few different conclusions, the most accurate one being the most difficult to find. Preparation consisted of making your character learn information: if you opened a book on how to perform autopsies at any time previously, the game would flag your character as having acquired that knowledge and extra dialogue options would appear during the autopsy for the player to choose. The player would still have to remember what was in the books, since the correct dialogue option would be added to a list of incorrect ones. Your reward/outcome depended on how accurate you were.

The same tests of knowledge could be used here. Perhaps it's not obviously a speechcraft tie-in, but it would produce more interesting gameplay for a speech-oriented character than the usual persuasion interface. It would encourage ingame literacy and gamify dialogue. In addition to this "knowledge-check" could be a Speechcraft check (since the right information is useless if badly presented). This could be extended from books to dialogue options, which would encourage the player to be a chatty Cathy with everyone he meets in order to collect potentially useful information.

Ultimately, this would allow for roleplaying as a sort of traveling bard, which was not possible in the vanilla game. Speechcraft there is limited to Making Friends and Influencing People, and when you think about it, has quite a cynical tone. This could be a more honorable use (but not necessarily).

Potential applications:

Your knowledge of magical history is tested at the Arcane University before you can advance in rank.

Having read a bandit's note, you convince him you are his liason.

You know how to present yourself before the Emperor after reading or hearing about the specific etiquette required.

Having read a book on royal lineages, you deduce that a local lord is a bastard born of incest instead of a rightful successor.

You read some stuffy books about law in order to compel a reluctant lord to bring justice to his corrupt captain.

You collect stories from fishermen and pass yourself off as an expert angler.

You enthrall an audience at a tavern with accurate stories (they nitpick) of far away lands.

Small ideas:

Learn languages (Daedric, Ayleid, etc.) and decipher artifacts or work as an interpreter

Debates - you can choose to appeal to logic or emotion

Have NPCs use their speechcraft skills to coerce the player (unless he has higher speechcraft)

Track the player's disposition to NPCs and affect dialogue accordingly

Unique face models for liars (slightly shiftier versions of vanilla faces). Could swap with a dummy NPC for the duration of the lie

Letter-writing mechanic - With the help of some courier service, correspond with NPCs remotely (turn in quests etc.) Letter text depends on speechcraft

There are some good ideas in here, and we have been considering various ways to expand the powers of speechcraft, also since it is an important skill in Imperial culture. That autopsy quest (and a lot of other witcher quests) are interesting examples of how things could be done. I am not going to comment on the good ideas here, but I do want to note some things that are likely complications, either impossible or too much of a hassle to implement:

Knowledge checks are a fun and interesting way of involving the lore texts in active gameplay. One problem is that scripting books is generally a bad idea, because it changes their inventory behavior and a lot of outside mods tend to do things with book scripts. This is something we can do passively, by directing the player to possibly interesting books (like the first few quests in the Morrowind main questline do) but leaving it up to them wether they want to read these or not.

Player disposition tracking and coercion-based options are bad ideas: most players have a well-identified idea of who and what their character is, and our job is to accommodate them: for example, most quests will always offer multiple optional paths for certain players who think their characters would make certain decisions, and all dialogue answers in the players voice are kept as neutral as possible. Taking away control over the player character's voice goes against our policy. Do note that NPCs coercing and misleading the player can happen, but we cannot force the player character to go along with them based on speechcraft numbers (in fact, it is often unnecessary: well-rafted dialogue can mislead the player much better than forced replies)

Unique face models: too much of a hassle, and Morrowind's native style is too undetailed for us to do it subtly. A much better way of doing this would be to provide unique dialogue for players with high speechcraft, noting that the NPC looks untrustworthy.

Letter-writing: again, this would imply assuming the player's voice, which is a no-no. It also raises a lot of questions (as in, if I can finish this quest through a letter, why can't I do this with all my quests?)

Time-sensitive dialogue: while I am not opposed to time-sensitive quests where appropriate (and well-signposted), doing this to dialogue would not only be very difficult to implement, but also a major mechanical departure from the vanilla game. Not a good idea imo.

Those points all make sense. This was throw-it-at-the-wall-style brainstorming, so I wasn't expecting everything to stick.

What I see as the major problem with knowledge checks that don't make sure the player has specifically encountered the necessary knowledge is that what's being tested has to be simple enough that it is believable that the player could successfully guess the right answer. That severely limits the possible applications. What's the issue with scripting books? I've never done scripting in Morrowind, but many of the vanilla books have scripts.

I can understand the complaint about letter-writing, but take out the speechcraft-dependent wordage and I think it could still work as a mechanic. Probably too marginal to be worthwhile here but maybe as a mod. The idea was to work with any quest where the giver owns property in a city. Massive amount of work but not too difficult I think.